With a statewide average of $2.93 per gallon, gas prices in Michigan were the highest in the country Monday, said Jim Rink, a spokesman for AAA Michigan.
One month ago, gas prices in Michigan averaged $2.25 per gallon, according to AAA’s Daily Fuel Gauge Report. Recent price increases might be caused by the expectation of an increased demand because of summer travel and the expectation for improvements in the economy, Rink said. But the main factor in the increase is maintenance at Chicago oil refineries, he said.
“Michigan and several other Midwest states are supplied with gas from Chicago-area refineries, and they have been experiencing some unscheduled shutdowns and maintenance issues that have kind of reduced the amount of gasoline available to our area,” he said.
Gas prices in East Lansing fell between $2.86 and $3.09 Monday. Admiral Gas, 1120 E. Grand River Ave., was recorded with the lowest price of $2.86, and BP, 504 Michigan Ave., was recorded with the highest price of $3.09.
For dietetics sophomore Megan Mcelwee, the recent increase has been tough because she is currently unemployed, as are some of her friends. She said many of them find themselves cutting back on weekend travel and other luxuries.
“It’s affected me a lot because I don’t have a job,” she said. “Usually you hate to ask your friends for gas money, but now everyone is really chipping in if we do go somewhere.”
Michigan gas prices are often slightly higher than in other Midwest states because Michigan is made up of two peninsulas, making shipping slightly more difficult, Rink said. According to AAA’s Daily Fuel Gauge Report, at this time last year, the statewide average was $4.06.
Illinois, Indiana, Ohio and Wisconsin had lower average prices than Michigan by an average of 10 cents Monday, according to AAA.
MSU economics professor Charles Ballard said maintenance in the Chicago refineries is normal for this time of the year and annually contributes to an increase. Additionally, the current price increases might be influenced by expectations for higher demand as the economy rebounds, Ballard said.
“Even though we may not be at the bottom of the recession, we can see the bottom,” he said.
“There is a strengthening demand for oil partly because of those expectations that the world economy is going to pick up pace in the next few months.”
Price increases might be related to holiday travel and the expectation that demand increases during summer months. However, gas prices should begin to decrease after the Fourth of July, Rink said.
“I don’t know if the price will plummet after (the Fourth of July), but it will probably hit a plateau, and then following Labor Day, we’ll see an even larger falloff,” he said.
“At least that has historically been the case.”
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